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Breaking Through the Corporate Purchasing Barrier

Written by William C. Shumay Jr. for Arcon Equipment Inc., published in the Material Handling Wholesaler
copyright © William C. Shumay Jr.
For more articles, please visit http://www.arconequipment.com

There are no doubt many advantages to the "corporate purchasing contract" for large companies, but on a local level it is clear that having a distant corporate headquarters dictate the purchase of certain specifications of material handling equipment is often an uneconomical approach. When a policy tells a manager he can’t work with a local material handling expert, to tailor an electric lift truck fleet to meet his specific requirements, trouble is sure to follow. This is especially true when it comes to the purchase of lift truck batteries.

Industrial batteries come in many shapes, sizes, and capacities. Service histories often clearly show life cycle advantages to using certain brands and certain capacities in a given plant’s operation. Rarely does a national corporate purchasing policy accommodate these considerations. Neither does it allow for an operational fact of life: Businesses need a local services expert to keep on top of battery maintenance and repair.

It is just such a local service expert that lift truck fleet owners must rely on to analyze the performance of their batteries and personally handle warranty claims. It doesn’t take long for a truck fleet owner to get a clear picture of how well the local representatives of certain battery manufacturers respond to warranty complaints, and this is vital information that should got into the next purchase decision. If the fleet owner adheres to his national purchasing policy slavishly, he cannot apply these lessons learned to the choice of a new battery.

One warehouse manager for a major restaurant chain found himself with a fleet of trucks powered by batteries with at least three strikes against them right from the beginning. The warehouse ran its trucks on a vigorous schedule that included multi-shift freezer operation. Unfortunately, the batteries purchased under the corporate purchasing policy were: 1) smaller than the maximum size allowed by the truck compartment, 2) the lowest rated capacity in that size, and 3) a brand with a poor reputation for service life under demanding conditions.

One hopes that corporate headquarters saved money on the initial purchase, because the first time trucks were stalled for mid-shift battery changing, it became clear that these batteries were going to demand expensive handling.

In this example, the corporate purchasing agent saved $350 in initial cost per battery, but pushed the real costs of time-consuming daily battery changing and production interference onto the local manager.

How did the warehouse manager respond once he realized that battery handling and downtime was going to make his job difficult? He moved to apply information provided by his local battery service shop, upgrading his battery inventory as his discretionary spending allowance permitted.

As it became clear that better batteries were needed on a larger scale, the manager informed headquarters that he needed authority to spend money on the right kind of battery for his needs. Soon, trucks that formerly had to visit the battery changing station before the end of a single shift were making it through two full shifts and beyond.

Because the new batteries were purchased directly from a local service organization that possessed a thorough knowledge of the warehouse manager’s needs, he obtained outstanding value and performance. He also received the peace of mind that stems from the assurance that warranty matters would receive the attention of the local representative, who would, in fact, act as the warehouse manager’s advocate in claims submitted to the manufacturer.

In addition, the careful review of warehouse operations conducted by the local battery man revealed that the important "equalizing charge " step was never being activated by the truck operators. Truck productivity was suffering as a result.

The chargers, mounted high on racks, were purchased by corporate headquarters with the specification that automatic controllers allow "hands-off " start and stop, but no one looked closely enough to notice that pushing "equalize " button was a manual operation requiring the truck operator to climb up the rack. Consequently, equalizing charging was seldom, if ever, done. An "on the scene " charger expert would not have failed to specify "auto equalize " as a charger feature necessary for this installation.

From this case history it is apparent that batteries and chargers are critical components that must be tailored to the local operation. A local manager must realize that he needs to ask for specific authority to take control of at least this aspect of material handling equipment purchases. The consequences can be expensive downtime and inefficient operation.

Sometimes these "bad battery decision costs " are hidden, but manifest themselves in the following ways:

  1. Undocumented, frequent interruptions to material handling operations to change or "boost charge " batteries in mid-shift.
  2. Maintaining a bigger lift truck fleet than necessary to allow for frequent battery changes.
  3. Frequent maintenance downtime for " poor batteries ", poor quality brands.
  4. Excessive time spent watering batteries – one consequence of operating with batteries in peaked condition.

These symptoms are just what a local battery serviceman looks for when he routinely speaks directly with the lift truck drivers about battery performance. When a manager takes charge of battery decisions locally, he can act on the advice of a battery technician who operates at the hands-on level and knows how to reach the goals of an ideal battery intallation.

For more information, contact Arcon Equipment Inc. (440) 232-1422.

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